The international banking regulatory system

2018-10-27 来源: 51due教员组 类别: Paper范文

下面为大家整理一篇优秀的paper代写范文- The
international banking regulatory system，供大家参考学习，这篇论文讨论了国际银行业的监管体系。自从布雷顿森林体系解体后，金融创新业务层出不穷，金融机构国际化日趋深化，导致金融体系风险加大，产生了严重的银行危机。为营造新的银行业经营环境，控制银行业国际化下导致的新风险，制定统一国际银行监管原则，多国召开会议决定，建立一个监管国际银行活动的协调委员会，这就是巴塞尔委员会。巴塞尔资本协议的核心是最低资本要求，而进行资产证券化可通过“分母战略”使银行达到提高资本充足率的目的，促使资产证券化迅猛发展。

The
frequent financial crises since the 1980s have exposed many inconsistencies in
the international financial system and its regulatory system. These
incongruities are concentrated in two areas.

Banks
have been fully internationalized, but most regulatory activities are still
concentrated in the scope of national sovereignty, and the rights of the
regulatory subject are limited within the territory of a country, while the
business of the object of regulation has already crossed the national boundary,
and the bank allocates resources and develops business on a global scale. The
result of this asymmetric system is the low regulatory efficiency and blind
area, which creates the conditions for the occurrence and international
transmission of the subprime crisis.

The
subject of supervision in various countries is the financial management
authorities of each country. When formulating national financial supervision
policies, it is necessary to take part in international supervision cooperation
from the perspective of national interests. We can use the simple Nash
equilibrium to analyze the participation enthusiasm of countries in the loose
organization:

In
collective rationality, no matter country A or country B, from the perspective
of individual rationality, Nash equilibrium is, that is, if there is no clear
timetable to urge the participating countries to implement relevant policies in
international regulatory cooperation, the participating countries will adopt A
wait-and-see attitude to delay the implementation or not fully implement
relevant cooperative regulatory policies.

After
the collapse of the bretton woods system, due to the lack of uniform
international supervision system, the regulation policy is different, and the
multinational Banks tend to choose relatively loosely regulated international
and regional business, and the important position of the financial industry in
main western countries economy make the government for the sake of their own
interests to relax regulation in the past thirty years. Even after the
regulatory cooperation agreement, some countries are still trying to delay the
implementation of policies to seek additional benefits for their financial
sector. The Basel new capital accord, which was enacted in 2004 and required
group of 10 countries to implement it in 2006, was delayed in the United
States, leading European Union Banks to express their strong dissatisfaction
that the extra preparation time given to the United States is not conducive to
fair competition and will undermine international cooperation in banking
regulation. The impact of the us move on the eu has proved to be far more than
worsening the competitive environment for the banking sector.

After
the disintegration of bretton woods system in the 1970s, financial innovation
business emerged endlessly, and financial institutions became increasingly
internationalized, leading to increased risks in the financial system. A series
of bank failures, including herstatt bank of Germany, led to a serious banking
crisis. To build new banking business environment, under the control of the
banking internationalization leads to new risks, formulate unified
international banking supervision principle, in February 1975, Belgium, Canada,
France, Germany, Britain, Japan, Italy, Luxembourg, the Netherlands,
Switzerland, Sweden and the United States held a meeting in Basel, Switzerland,
the meeting decided, establish a supervision of international banking
activities coordination commission, this is the Basel committee. The first
Basel accord was introduced in September 1975. The core content of this
agreement is: aiming at the problem of the absence of regulatory bodies after
the internationalization of the bank, this agreement stipulates that no foreign
institution of any bank can evade regulation, and the home country and the host
country should share the responsibility of supervision. In 1983, the Basel
committee revised the agreement to further clarify the regulatory
responsibility of home and host countries, but the agreement only proposed the
regulatory principles and the distribution of responsibilities, but still
failed to propose specific and feasible regulatory standards.

It
was first proposed to use capital regulation for bank risk control in 1987. In
1988, the committee published the Basel capital accord, which had far-reaching
effects and changed the world banking regulatory structure. The agreement has
so far been adopted by more than 100 countries, and an 8 per cent core capital
ratio has become a common standard for international Banks.

The
core of Basel capital accord is the minimum capital requirement, while asset
securitization can make Banks achieve the goal of improving capital adequacy
ratio through the "denominator strategy", thus promoting the rapid
development of asset securitization. To restrict Banks using asset
securitization to capital arbitrage, "the new Basel capital accord"
in June 2004, a new protocol for the old structure of the three pillars, the
asset securitization risk for the first time into the first category, to
advocate the irb in terms of risk measurement, to strengthen the information
disclosure, make towards improvement of international banking regulation.

The
new agreement puts forward the "asset securitization framework" for
the first time. When determining the capital needed for the risk exposure of
asset securitization, it must be based on the economic connotation rather than
the legal form. This regulation ADAPTS to the development trend of various
forms of asset securitization and gives regulators considerable flexibility.
The new agreement has good operability in the international scope. If it can be
widely used in the international scope, it will help to form a relatively fair
environment for competition and development. In addition to measuring credit
risk, improvements have been made in terms of operational risk, market
discipline, supervision and inspection, and information disclosure.

The
new agreement is more sensitive than the old one in terms of risk measurement
and can restrain the regulatory capital arbitrage more effectively, which is
conducive to guiding the sound operation of Banks. In terms of risk
measurement, the new agreement proposes three methods: standard method,
internal rating primary method and internal rating advanced method. Banks and
regulators can choose on their own merits. The aim of the IRB method is to
reflect the relationship between capital and bank risk more accurately. Bank by
using this method, to estimate the borrower default probability, default loss
rate and default risk exposure estimate is converted into corresponding
risk-weighted assets, and according to the provisions of this part calculates
the regulatory minimum capital, to strengthen the risk sensitivity, for
regulatory capital arbitrage problems of the regulation of the old agreement
has made the improvement.

It
has high flexibility in risk measurement and introduces the concept of
incentive compatible regulation. The new agreement also allows for the use of
standard and internal rating methods to promote the construction and
application of Banks' internal rating systems, and encourages qualified Banks
to accelerate the implementation of internal rating laws. The adoption of
"incentive-compatible supervision" in the assessment of asset
securitization risk and regulatory capital requirements is conducive to
accelerating the development of bank risk measurement technology.

The
new agreement, which takes market discipline as one of the three pillars, plays
the role of market mechanisms, stipulating that regulators must develop an
effective information disclosure system, requiring Banks to release information
in a timely and comprehensive manner, and enabling market traders to make
timely judgments and respond.

From
the perspective of the development process of Basel capital accord, it has been
passively adapting to the development process of bank internationalization and
financial innovation. The scope of international banking risk supervision has
been expanding, and more and more attention has been paid to financial
innovation tools. The supervision of financial derivatives will become the
focus of international banking supervision in the future. In addition, the
implementation of internal rating law also indicates that the trend of future
supervision is the combination of internal and external supervision of Banks.

The
new agreement requires financial institutions to adopt the same approach for
risk measurement and treatment, and institutions adopt similar methods for risk
measurement and allocation of corresponding regulatory capital and impairment
provision

Financial
assets are initially measured and subsequently measured in accordance with fair
value. No matter they are collateral or securitized products, when the market
is in a boom cycle, the value tends to be consistent, and various market
participants tend to have the same understanding of risk, which weakens the role
of market diversification risk and easily leads to pro-cyclical effect.

Because
the new agreement regulates the credit risk in too much detail, the cost of
establishing a new enforcement system is too high, and the proposed new rules
are too detailed. A system riddled with red tape is bound to be leaky and could
be exploited by Banks. If implemented, these provisions could worsen the
economic cycle by encouraging Banks to lend in good times and lending sparingly
in bad times.

The
complexity of the risk measurement model of the new agreement's internal rating
method determines the relatively narrow range of Banks it covers. In fact, only
big Banks can have the resources and expertise to establish and maintain
complex risk management systems and adopt advanced credit risk measurement
methods with the new framework, and only transnational Banks can have the
capital and human resources to implement the IRB method. However, in order to
implement it, small and medium-sized Banks must spend a lot of time and cost to
accumulate the professional skills of risk management and establish information
technology system. It is estimated that the average bank could incur an
additional cost of $500,000 to $15m a year to measure credit risk using this
method.

Although
the capital regulatory framework of asset securitization under the new
agreement provides a relatively consistent guideline for the risk measurement
of commercial Banks' asset securitization, the new agreement still does not pay
enough attention to the market risk and operational risk of securitization. In
the measurement method, there is no explanation of market risk or operational
risk.

The
third pillar of the New Deal is market discipline, which is designed to make
market forces more binding by requiring Banks to disclose information.
According to the importance of the information, the new agreement requires the
bank to disclose the scope of application, capital composition, risk exposure
and capital adequacy ratio of the new capital agreement. Core disclosure
applies to all Banks, while Banks using the internal rating method must
disclose other relevant information. It is difficult for Banks to find the
right balance between the cost of transparency and the cost of providing it.

The
original intention of the framework of asset securitization under the new
agreement is to limit capital arbitrage, but the market is always ahead of the
supervision. As for the risk measurement of asset securitization, standard
method, internal rating method and senior method can be adopted, and there are
still capital arbitrage opportunities in different risk treatment methods. The
new agreement, for example, encourages Banks to adopt advanced internal rating
methods to improve their risk management, which would require less regulatory
capital than would otherwise be required, creating new opportunities for
regulatory arbitrage. Banks can also reduce regulatory capital requirements by
designing synthetic securitization products suitable for internal rating. Even
if we try to improve the regulatory framework now, the arbitrage opportunity
will always exist under the developing financial innovation, which makes it
impossible to eliminate the capital arbitrage through the asset securitization
framework.

Due
to the high requirements of internal rating technology and data, small and
medium-sized Banks are restricted by conditions and difficult to meet the
requirements, thus putting them at a disadvantage in the competition. As
mentioned earlier in incentive-compatible regulation, the use of the internal
rating method is more advantageous than the use of the standard method, and the
use of the higher method has lower capital requirements than the use of the
primary method, with the goal of facilitating Banks to improve their internal
risk management techniques. However, due to the complicated technology of
internal rating method, many small and medium-sized Banks do not have
corresponding technical level. From the perspective of scale effect, the cost
and benefit ratio of big Banks to adopt advanced risk measurement method is
lower than that of small and medium-sized Banks, which will be unfavorable to
the development of small and medium-sized Banks and worsen the competitive
environment of Banks.

In
addition, if the new agreement is implemented worldwide, developing countries
will also be at a competitive disadvantage since developed countries also have
better technologies in risk measurement and management than developing
countries.